What specific factors are driving up operations costs of the typical LTL carrier? Short answer: Everything. But the best-run carriers are doing their best to mitigate these rapidly rising cost spikes. Let’s look into what’s happening to costs where the rubber meets the road.
Most carrier executives say that the current lackluster growth in Gross Domestic Product does not inspire much confidence in the U.S. economy—but it’s actually been a positive for shippers. If the economy were growing any faster, it would likely result in a true capacity shortage in LTL due to the lack of available drivers.
Coming off four consecutive good years, LTL carriers expect that trend to continue in 2014. But there is always a concern over the fragile state of the economy. An economic downturn could lead to a degradation in pricing discipline—and the 2008-2009 spiral could begin all over again, carriers say.